MGM Energy Corp MGMCF

News Release - good news

[OilEng]

They have just announce the result and I think they are good.  They found light sweet crude.  Yeah!!!  The test produced almost 1,900 barrels in 9 days.  Of this the majority was the oil used in the frac with formation oil being produced at the end of the test which was light and sweet. 

This confirms:

1. MGM lands are in the light oil window, not the gas or wet gas window.
2. They found 100 metres of Canol and 20 metres of Bluefish.  This was almost exactly as they expected.
3. This means Block 466B has a lot of light sweet oil in place- about 110 million barrels per section.  Husky lands have between 20 and 90 million barrels per section (average 55 million barrels per section).
4. This is 3 to 5 times as much oil in place per section as the Eagle Ford or the Bakken respectively. 

[farml1234]

I say you are correct OilEng This was a very small frac job , you want to see a big frac job come down here and see a 2 to 3 million gallon thats 47,619 Bl frac job using a 2,000,000 gallon frac job   I hope MGM listens to someone down here on letting the well set before starting flow back   My guess some flippers may sell on the open     JMHO

[farml1234]

I say you are correct OilEng This was a very small frac job , you want to see a big frac job come down here and see a 2 to 3 million gallon thats 47,619 Bl frac job using a 2,000,000 gallon frac job   I hope MGM listens to someone down here on letting the well set before starting flow back   My guess some flippers may sell on the open     JMHO

[SigmaKappa]

Validation is good. Still the question of is it commercial. Would have ben nice for them to say what there plans going forward are.

[oregonmcm]

OilEng,   Where did you find the 1900 barrels in 9 days number?   From what I can tell, it does say that they found light, sweet crude, which is a good sign, but it doesn't say how much of it they found, since the 140 barrels over 4 days figure from the press release doesn't breakdown how much was gas, how much was returned frac fluid, and how much was crude.   I must be

[OilEng]

It would be wonderful if the testing could determine if the play is commercial; however, no short duration test on a vertical well is going to do that in shale oil.  You need horizontal well with testing periods of many months to establish type curves.  This is why Husky is putting in the all-weather road.   They are planning on drilling horizontal wells and testing them for months

[oregonmcm]

Ah, I see now. I misread your initial post. Still, I wonder how much of this is light, sweet crude and how much of it there would be if they could drill a horizontal well. Oh well, hopefully the confirmation of light, sweet crude moves the price up until a horizontal test can be conducted.

[OilEng]

Hi Oregonmcm:  You have to flow back the fluid you use to do the fracture before you can recover formation fluid.  They used 2,450 bbls of oil on the fracture and recovered 70% of it over a 5 day period (1,715 bbls) before recovering 140 bbls of formation and frac fluid for a total of 1,855 bbls of fluid recovered.  I think this is pretty good.  Wells in the Bakken and Eagle

[CommMarine85]

OilEng, Do you doubt the Canol is commercially viable?  If recovery rates exceed EF and Bakken, plus the area build out, it must hold what they believe exists. 

[OilEng]

Hi CommMarine85:  I think it is commerical and that is why I am so heavily invested in MGM.  The reason are because of: The amount of oil per well far exceeds any other play that I have looked at.  It is one of the best quality shale oil reservoir in North America according to Matt Fox who is VP of Conoco.  As a result, we should get recovery factor as good or better than

[CommMarine85]

 I completely agree with your assessment.  I also enjoy reading your posts.